Brazil’s private equity firm ABF partners with farmland investor Agrifirma to launch new joint venture
Agrifirma is a modern farmland operating and development company, founded in 2008 by financier Lord Rothschild, corporate raider Jim Slater and hedge fund manager Hugh Sloane. The company produces coffee, cotton, corn and soybeans in South America farm fields with state-of-the-art technology.
Agrifirma’s objective is to provide substantial quantities of grain and other agricultural products to help fill the growing shortage of supply in the developed and developing worlds. The investment company believes that South America is ideally positioned to satisfy the world’s food demands, due to its excellent soil, weather and highly qualified labor force.
The company first raised usd 154 million in 2008, making it one of the first farm funds. The company bought up more than 100,000 acres of Brazilian scrubland which it has spent the past three years transforming into viable agricultural land.
The company has recently announced the launch of a new joint venture with one of Brazil’s biggest private equity investors. On August 31 2011 Agrifirma became a Brazilian-controlled company following the acquisition of a majority controlling shareholding by Fundo Brasil Agronegócio (ABF), a private equity fund managed by BRZ Investimentos, one of Brazil’s largest independent asset management firms.
The new fund, Agrifirma Brasil Agropecuaria, will receive an usd 82 million investment from Fundo Brasil Agonegocio to “accelerate” development of Agrifirma’s existing projects, which include huge areas of undeveloped land in Brazil’s Bahia region.
The company’s objective is to provide substantial quantities of grain and other agricultural products to help fill the growing shortage of supply in the developed and developing worlds using sustainable methods of production.
Agrifirma itself will be renamed Genagro. It will retain direct ownership of one fully developed Brazilian farm. The company will then use its estimated usd 52 million cash pile to look for other agricultural opportunities outside Brazil, with the ultimate ambition of later floating itself.
The investment means the company will postpone its planned IPO on the Hong Kong stock exchange, which was reportedly called off due to market volatility. It has received backing from some of Asia’s wealthiest tycoons, including Hong Kong investors Raymond Kwok and Adrian Fu.
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